Morningstar

Morningstar, Inc.

Equity Bottom-Up

We think Tencent has put more focus on cloud and advertising businesses following its reorganization. The cloud and smart industries group has been created as a stand-alone segment for the cloud business and enterprise-facing services such as smart retail. The advertising and sales department and the social and performance advertising department were merged to form the advertising and marketing services business under the corporate and development group. This business can provide advertisers…

For the first quarter of 2019, wide-moat Tencent’s revenue grew 16% year on year, mainly driven by 26% growth in the new segment, fintech and business services. The fintech and business services segment accounted for 26% of revenue, with financial technologies such as commercial payments and microloans contributing the majority of the revenue. Operating profit (which excludes interest income and other gains and losses, unlike reported operating profit) was up 10% year over year, with a…

China

Tencent Holdings Limited operates as an investment holding company. The Company, through its subsidiaries, provides Internet and mobile value-added services (VAS), online advertising, and e-commerce transactions. Tencent Holdings offers services to users worldwide.